Generation Alpha, the oldest of whom are just 11, are already online consumers. How will physical … [+]
The most important future shoppers can’t yet drive. But they buy. Can retailers steer them to the store?
The oldest members of the next generation of consumers, Generation Alpha, were born in 2010, yet in just a decade they’ve learned to become smart online shoppers. In 2020, 81% of children under the age of 12 were reported to influence family purchases, translating to $500 billion in purchases a year.
Now, with physical retail reopened, they will likely become curious about what brick stores have to offer. This may especially be the case for shopping centers, where many of Gen Alpha’s older cohorts, Gen Z, gather to socialize and for a sense of community.
For malls, this can be a rare, confluence-of-events opportunity – if they take time to appreciate the distinguishing factors of this generation’s behavior. In July, mall foot traffic surpassed 2019 levels for the first time since the pandemic started, according to research by Placer.ai. Because Gen Z members contribute to that bump, and Alpha looks up to them, the rise in traffic could place shopping centers on the radar of Gen Alpha.
A Trail To Gen Alpha
Sizing up generational behavior requires factoring in outside influencers. The actions of Gen Alpha, like the generations before it, are swayed by the age group immediately preceding it. That would be Gen Z, who these younger cohorts look up to. The behaviors of Gen Z – in technology adaptation, for example – form the start of a breadcrumb trail that leads to this latest generation.
Malls need to prove they are sustainable.
The youngest consumers not only want to do business with environmentally conscious merchants, they will even work for them. Malls that prove their sustainability therefore have a two-pronged opportunity down the road. The majority of Gen Alpha members, 63%, said they are more interested in jobs linked to environmental protection than any other issue, according to research by the consultancy Censuswide for Wunderman Thompson Commerce. Nearly one in five (18%) would prefer to buy products not made from or packaged in plastic. Shopping centers would likely benefit from promoting their positive environmental actions and even consider playing a role in the community by organizing events that engage shoppers in these critical conversations. Malls and retailers already have a head start connecting to these preferences, thanks to Gen Z and their attitudes. This group not only prefers to buy sustainable products, they are willing to pay 10% more for them.
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Integrate the mall into social media for commerce and communication.
Members of Generation Alpha, like Gen Z, are eager to use social media to engage with issues that matter to them, as well as shop. A predicted 28% of Gen Alpha will use social media to shop as they mature, compared with 23% of Gen Z. And more social media platforms are teaming with shoppable, direct-to-consumer brands – essentially acting like virtual malls. TikTok and Walmart in the spring hosted their second livestream shopping event, after a test event netted seven times more views than expected. Malls can get into this game. But note: Because Gen Alpha is following in Gen Z’s footprints, as they mature they will likely look for stories that explain what goes into the goods they buy – including fair-employee practices. This presents an opportunity for mall operators and tenants to tell their own narratives, in addition to the stories behind the goods they sell, on the platforms this market prefers. But all merchants should be aware that tomorrow’s TikTok may not yet exist.
Yes, malls should incorporate technology, but it should be technology with a purpose.
Nearly half of kids ages 7 to 12 believe technology can solve some of the world’s problems, AdAge reports. And more than half (51%) want to use technology to make a difference, according to the Wunderman Thompson research. These beliefs build on their older cohort, Gen Z’s, trust in technology to help solve “the problems they see plaguing the world.” The point: Technology with purpose can improve retail sales. Indeed, 66% of Gen Alpha members want to shop brands that contribute to a better world. Retail centers that incorporate technology that evidently promotes a better community will likely leave a strong impression. It doesn’t have to be super-high tech: Smart recycling bins, for example, use artificial intelligence to remove questions of how to sort trash. The technology covers so many “we care for you” bases: it is intriguing, it makes the trip easier and it is an efficient investment in the environment.
Gen A Is Leaving Its Own Trail – Follow It
Retail’s future may rest, in part, on the shoulders of 11-years-olds, but those shoulders are shaped by everything they see and learn around them. Shopping centers and the retailers that inhabit them have the wherewithal to play a major role in that shaping.
Success hinges on listening to these young consumers, anticipating their evolving values and factoring those preferences into communications – not just in language, but in presentation and actions – from the mobile app to the store.
Age is more than a number (even if that number is $500 billion). Those who don’t pay close attention to Generation Alpha risk losing the next generation (Beta?). Because, make no mistake, they are paying attention. And soon, they’ll be behind the wheel, too.
